January-April Fort Smith tax collections down 1.03%

A 1.03% dip in sales tax collections for the city of Fort Smith for the first four months of 2009 have the city’s director of finance suggesting a budget review may be necessary if the trend continues.

Collections on the city’s 1% street tax program totaled $1.689 million in April, up 3.05% compared to April 2008. Collections on the city’s portion of the 1% countywide sales tax in April was $1,349 million, up 2.61% compared to April 2008.

For the first four months of 2009, the city sales tax is down 1.03% compared to last year, and the sales tax is 3.67% below year-to-date budget projections. Year-to-date, the city’s portion of the county sales tax is down 0.75%, and the collections are 3.55% below budget projections.

“The actual revenue loss to the General Fund budget is $188,348 to date,” noted a memo from Kara Bushkuhl, Fort Smith’s director of finance, to City Administrator Dennis Kelly. “All departments have been asked to review expenditures very carefully and keep spending as low as possible. Depending on the next two month’s revenues, it may be necessary to adjust the 2009 General Fund budget.”

PREVIOUS COLLECTION INFO
• 2% sales tax collection (1% for streets; 1% for water/sewer bonds)
2008: $41.226 million
2007: $37.858 million
2006: $36.840 million

• Fort Smith portion of 1% countywide sales tax
2008: $16.61 million
2007: $15.15 million
2006: $14.71 million

(Because the state of Arkansas has a two-month delay in reporting collections back to the cities, the city of Fort Smith — for budgeting purposes — has historically reflected the collections on a one-month delay. Which is to say, the tax collections remitted back to the cities in April are from taxes collected in February and transferred by merchants to the state in March.)